Nogger's Blog

18/11/13 -- Soycomplex: Beans resumed their winning ways, despite receiving no help whatsoever from corn. Weekly soybean export inspections topped expectations of 65-76 million bushels, coming in at 87.809 million and exceeding 80 million for a fourth week in a row. It's this very strong front end demand that's supporting the market. Argentine farmers meanwhile continue to "hoard" beans as a hedge against inflation. The Rosario Grain Exchange said that Argentine growers still hold 13 MMT of unsold soybeans from the 2012/13 harvest, and have only forward sold 2 MMT of their anticipated 2013/14 production, which is around half of what they had sold last year at this time and a third of the 5-year average. Advanced sales of Brazil's 2013/14 soybean crop meanwhile are also well behind year ago levels. Safras e Mercado estimated that farmers there had committed only 33% of their crop, up a meagre one percentage point in an entire month, and versus 48% this time last year. AgRural said Friday that Brazil has 69% of it's 2013/14 soybeans planted versus 59% a week ago, 67% a year ago and the five year average of 72%. Argentine plantings are said to be in line with normal at 21.8%. Brazil has apparently told China that soybean shipments will flow much easier in 2014 than they did earlier this year. We wish them luck with that promise. Oil World estimated the 2013/14 global soybean crop at 286.5 MMT versus a previous forecast of 281.3 MMT and up 7.2% on the 2012/13 crop of 267.3 MMT. After the close the USDA said that the US 2013 soybean harvest was up 4 points at 95% complete, in line with expectations although marginally behind 96% normally. Jan 14 Soybeans closed at $12.87 1/2, up 7 cents; Mar 14 Soybeans closed at $12.73 1/4, up 7 1/2 cents; Dec 13 Soybean Meal closed at $415.80, up $5.30; Dec 13 Soybean Oil closed at 40.11, down 36 points. Friday's EPA announcement sees oil happily resuming the role of the weakest leg of the trilogy.

Corn: Bad news is just stacking up for a corn market that crashed to new lows, and with Dec 13 ending at levels not seen on a front month since August 2010, on what looks like a market playing catch-up with Friday's EPA announcement (which was only issued shortly before the end of trade). The timing of that could not have been worse, coming right as a record high US corn harvest is winding up. Reports that China had rejected a cargo of US corn after it was found to contain a non-permitted GMO strain was also bearish on a market that is looking to the Far East to take an increasing chunk of this record crop off it's hands. Reuters reported that the shipment contained Syngenta AG's Agrisure Viptera corn, also known as MIR 162. China is known to have struck a deal with Ukraine to take 2 MMT of corn this season, and is also a buyer of Argentine corn and has recently approved Brazilian corn for import, so clearly the US no longer has this market all to itself. South Korea's Nofi was said to have bought 136 TMT of US corn for April shipment. South Korea's MFG bought 113 TMT of optional origin, said to most like be from the Black Sea, corn for April shipment. Dow Jones reported that buyers here are now 50% covered for April. Iran is said to have bought 35 TMT of Black Sea corn. Safras e Mercado estimated the 2013/14 Brazilian corn crop at 75.2 MMT. That's down from a previous estimate of 77.2 MMT, but still well above the USDA's estimate of 70.0 MMT, although a decline on their 2012/13 record crop of 82.1 MMT. The Argentine crop is said to be 40% planted versus 54% a year ago at this time. Weekly US export inspections of 30.76 million bushels were in line with trade forecasts of 26-32 million. After the close the USDA said that the 2013 US corn harvest was now 91% complete, up from 84% a week ago and at the top end of expectations. Fund selling in CBOT corn was estimated at around 12,000 contracts on the day. Dec 13 Corn closed at $4.12, down 10 cents; Mar 14 Corn closed at $4.21, down 9 1/2 cents.

Wheat: A wheat market that is trying to keep it's head above water, as corn sinks, closed around 1 to 4 cents lower on the day with Kansas wheat again displaying the most weakness. The reason for that is winter wheat in the US being in far better condition than it was a year ago, and amongst the top 25% on record. After the close the USDA did not issue a planting progress report for winter wheat (it was said to be 95% done last week), suggesting that they now regard sowings as complete. They estimated good/excellent conditions at 63%, almost double the 34% of a year ago, even if that was down 2 points on last week. They said that 89% of the crop is emerged versus 85% for the 5-year average. South Korea flour mills bought 47,200 MT of US milling wheat for March shipment. Other than that the tender line-up is not leaning towards much business heading the way of the US. India are back in the market to sell wheat, and picked up numerous bids at anywhere from $260 to over $286 on an FOB basis. It remains to be seen which ones, if any, get booked and how low the government are prepared to go at this stage. Their revised stated minimum is $260, but it's unlikely that they will feel the need to capitulate to those levels just yet. Egypt's supplies minister said that they have enough wheat to supply their needs through to March. Regardless of that they did however issue a late tender for wheat for Dec 11-20 shipment. French wheat has to be the hot favourite to win that. Canadian wheat was said to be the lowest offer in an Iraqi tender to import wheat that closed on Sunday. The cheapest Canadian offer was said to have undercut the best US price by almost $25 on a CIFFO basis. Iran said that they'd imported 4.76 MMT of grains in the Mar-Oct period, a fall of 42% versus the same period in 2012. Of that total 1.64 MMT was wheat, a 53% decline. Dec 13 CBOT Wheat closed at $6.42 1/4, down 2 1/4 cents; Dec 13 KCBT Wheat closed at $6.94, down 4 1/4 cents; Dec 13 MGEX Wheat closed at $6.95 1/4, down 1 1/2 cents.